The Government is still planning to release a call for evidence on the home-buying process and met as recently as November to discuss it, EYE can exclusively reveal.
Former Chancellor George Osborne announced in his March Budget that the “Government will shortly publish a call for evidence, looking at the process of buying a home”.
But nothing has been heard since and instead focus has moved to a Housing White Paper now due in January and a consultation on the lettings fees ban in the New Year.
However, the home-buying process is still firmly on the Government agenda.
EYE submitted a Freedom of Information request to the Treasury asking what has happened to the call for evidence and was told “the home-buying process remains under consideration and the call for evidence will be published in due course”.
The response said the Department for Business, Energy and Industrial Strategy is the lead department for this policy and that it had already considered the Office of Fair Trading’s 2010 Market Study on home buying and selling as well as 2014 analysis from the Scottish Government.
It said meetings had been held on March 7 and May 27, as well as on November 3 in a “Switching Programme Board” meeting.
The Switching Programme Board forms part of the Government’s work on consumers shopping around and encouraging actions such as bank account and energy supplier switching.
It is a strange fit with property, but home buying and selling seems to have been attached as evidenced by a paper released in December 2015 by the Treasury titled A Better Deal: Boosting competition to bring down bills for families and firms. The document looked at big bills for consumers such as energy and broadband as well as buying a home.
A section headed “Injecting innovation into the process of home buying” said the Government wants to inject innovation into the process of home buying, ensuring it is modernised and provides consumers with different – and potentially quicker, simpler and cheaper – ways to buy and sell a home.
It said: “Encouraging new business models (for example, online only estate agents) is key to enhancing price competition in the real sector, but these have yet to penetrate the market.”
The paper continues: “In addition, emerging findings from government research suggest that consumers incur costs of around £270m each year when their transactions fall through and they have already spent money on legal fees and surveys, and many more sales are subject to costly delays.
“The Government wants to consider and address the way the real estate and conveyancing markets have developed around the existing regulatory frameworks, encourage greater innovation in the conveyancing sector and make the legal process more transparent and efficient.”
At the time the Treasury said it would publish a call for evidence in the [2016] New Year, but almost a year later it is still to emerge.
There is no firm timetable on when the call for evidence promised “shortly” last March will be released and it is hard to know what the Treasury means by “in due course”.
The phrase is as meaningless as “Brexit means Brexit” but as a point of reference, current Chancellor Philip Hammond said he wanted a lettings fee ban to be introduced “as soon as possible” – something that according to a DCLG official at the recent ARLA conference said may not happen until 2018.
Comments (7)
Couldnt agree more with sb007ck. When I read that Gareth Bale’s agent made £14m commission from his move to Real Madrid, why is there such an outcry over our fees? Whats wrong with a fee of 2% if we’ve done the job properly and in the process negotiated a such good price for the client that in reality its the buyer who’s paying our fee? Good agents, which most of us are, are working harder for less as we have to sell more houses just to stand still. The art of negotiation, and it is an art, is being lost largely because the online agent simply doesnt need to do it, they have no incentive. I dont know how long it will take for that penny to drop but the sooner the better.
Paulfromromsey87 – I’m firmly on board with the vast majority of what you’ve posted
“Whats wrong with a fee of 2% if we’ve done the job properly and in the process negotiated a such good price for the client that in reality its the buyer who’s paying our fee?”
In theory, nothing whatsoever… as far as Vendor or Agent are concerned. Win:win right down the line (assuming, that is, that the said “2%” is a fee that actually makes a profit…).
However it depends entirely on where you’re standing on the extended line that makes it all go a bit Pete.
Purchasers reading this will find it very wrong indeed – as according to your words they are effectively paying 2% over the odds.
Then, some “consumer action group” will pick up the baton on behalf of the poor “victims” (in order to gain some attention/win some funding or whatever) – and Robert’s a brother/brother-in-law of one of yer parents.
There you have it – bruhaha courtesy of The D@mned Estate Agent once again.
Dont mind the bruhaha PeeBee. Im just pleased someone read it! And Robert was my mum’s brother-in-law! Happy Xmas!
Those that didn’t read it, should.
You make several very valid points, Sir.
2%… our fees have been driven down year on year since the credit crunch, average fee of 1% is more typical in my area!
1% of what though, laahdeedah29?
Why is it always about cheapening everything, does no one actually care about the level of service. A ban on fees charged to a tenant will undoubtedly cause problems/delays, and now this promoting of call centre estate agents. As people who dont work in the industry but only hear about the down side of estate agency, they need to be told, that the more crappy online agent and online solicitors there are, the longer and more stressful the process will be.